ECB president, Mario Draghi, spoke in this morning’s press conference about how contagion has been contained in the eurozone bond markets since the Italian elections. The data are in and he is right.

The markets had closed before the election results were announced on Monday February 25th . After blowing out the next day, periphery 10-year sovereign spreads to the German bund have come in with Italy now only 18 bps wider since the election, Spain 21 bps tighter, Portugal 17 bps tighter, and Greece 5 bps wider. Contained, indeed!